Day traders: Theyâre baaaack!
- Thread starter nkhoi
- Start date
Two statements from the article I took exception to are (1) Even the best traders are wrong more often than theyâre right
Depends on style and frequency of trades but I know plenty of traders who are right 60, 70 or 75+% of the time. I think I'm around 74% after 8 years ...
(2) Day traders seem to perform best when stock prices are rising sharply. Most day traders are allowed to sell stocks short (to profit from falling prices). However, thereâs little evidence to suggest that they were able to use their ability to short stocks to make money -- or at least avoid disastrous losses -- during the bear market. The obvious conclusion is that most day traders are just like the rest of us: When the market roars, they may make good money, and, when it turns inhospitable, they suffer -- only more so because they take greater risks.
The reason many day traders do best in bull markets is that lots of them aren't real traders. Rather they're jumping on a bull bandwagon. Any idiot can throw darts in a bull market and make money. Real traders not only play both sides but make money (often times intra-day) on both the long and short side of the market. This nonsense of questioning if traders made money in the meltdown is asinine.
Depends on style and frequency of trades but I know plenty of traders who are right 60, 70 or 75+% of the time. I think I'm around 74% after 8 years ...
(2) Day traders seem to perform best when stock prices are rising sharply. Most day traders are allowed to sell stocks short (to profit from falling prices). However, thereâs little evidence to suggest that they were able to use their ability to short stocks to make money -- or at least avoid disastrous losses -- during the bear market. The obvious conclusion is that most day traders are just like the rest of us: When the market roars, they may make good money, and, when it turns inhospitable, they suffer -- only more so because they take greater risks.
The reason many day traders do best in bull markets is that lots of them aren't real traders. Rather they're jumping on a bull bandwagon. Any idiot can throw darts in a bull market and make money. Real traders not only play both sides but make money (often times intra-day) on both the long and short side of the market. This nonsense of questioning if traders made money in the meltdown is asinine.
Agreed, those were most of my criticisms of the article but I was to lazy to articulate them.
The article seems to focus on the monkey daytrader which basically gambles on the long side just waiting for that break out stock. Naz has been providing these opportunities lately. Then there is the monkey NYSE scalping of the advertised bid which works quite well on strong up days. So the recent bull market has allowed these "traders" to re-enter the market.
Personally, I make my best trades from shorts and have been focusing on doing more and more shorts to prepare for the possible grinding third leg of the bear market. On the good days I am right 70%+ of the time, sometimes as good as 90%+ even 100% a few days. All the good traders I know and have ever known possess great accuracy, at the absolute least of 65%. I do not know of one profitable trader today that has below 50% accuracy and gambles for that one great trade that makes his day. It happens and it has happened to me but I do not like relying on this type of strategy. I have learned my lesson quite well during the past month about gambling for the one big trade to pull you out of the hole.
The real traders never went anywhere, there has been a big interest and newbies even after the tech bubble pop.
yes, except it's compressed.........a stock that goes from 1.50 to 3.50 is not the same as a stock that goes from 150-350....risk/return arguments may ensue but i think there is much more favorable opportunity at the loftier levels........both are musical chair lottery tickets.
grimer11
grimer11